Wealth Management: What should I know about wealth management institutions?

Your Responsibilities As A Client

As a client, you will be asked by your wealth management institution to give a fair amount of information about your company and the owners, i.e. yourself and your business partners.

This is to enable the wealth management institution to draw up a financial plan that fits your financial goals and to comply with the requirements of the Anti-Money Laundering Act 2001.

Investing Via Wealth Management Institutions

Most wealth management institutions impose a minimum amount for investment. This ranges from RM50,000 to RM1 million. These funds could be invested in various investments such as fixed deposits 1, listed equities, corporate bonds 2, unit trusts 3 or structured products.

Before recommending any product to you, the wealth management institution will need to determine your risk profile.

Corporate bond - A debt instrument for a loan which is issued by a borrower to an investor who is the buyer of the bond and lender of the money. In return for the money, the issuer agrees to pay regular interest to the bondholder for the term of the loan and the principal sum borrowed upon maturity.

Unit trusts - Pools of money managed by an investment company. They offer investors a variety of choice, depending on the fund and its investment objective.

Time weighted rate of return - A measure of compound rate of growth in a portfolio.